Ark Invest shifts to the crypto market, betting on Coinbase and Robinhood
At the same time as partially exiting some major tech companies, Ark Invest has also increased its investment in the crypto sector.Written by: BeIncrypto
Compiled by: Blockchain Knight
In the past week, Ark Invest has reduced its holdings in Tesla. At the same time, the firm has shifted to invest heavily in the Crypto industry, acquiring significant shares in Coinbase and Robinhood.
This investment management company, focused on the technology sector, holds stocks of several companies in the Crypto industry through its exchange-traded funds (ETFs).
Earlier this month, Crypto exchanges like Coinbase faced devaluation, but their stock prices have rebounded in the past week.
Through its innovative ETFs and next-generation internet ETF, Ark sold nearly $16 million worth of Tesla shares in the past week.
Even though the company remains a significant investor in Tesla, Ark's move to partially divest from the electric vehicle manufacturer reflects a cooling view on tech stocks.
In the year to date, Tesla's stock has risen by about 140%, but several institutional investors are pessimistic about its near-term outlook.
On Wednesday, in a report to investors, Barclays analyst Dan Levy downgraded Tesla's stock from overweight to hold.
The report stated: "We believe the recent rebound in the stock can be explained by the market's current AI-driven thematic trading… While we are not surprised by the stock's rebound, we believe that taking a wait-and-see approach is prudent."
Similarly, on Thursday, Morgan Stanley analyst Adam Jonas also downgraded Tesla's stock to hold.
In addition to Tesla, Ark Invest also sold off a range of other blue-chip tech stocks this week.
For instance, on Friday, it sold 78,676 shares of Shopify, worth over $5 million. Additionally, Ark reduced its exposure to online sports betting company DraftKings.
While partially exiting some major tech companies, Ark Invest has also increased its investments in the Crypto space.
The firm holds significant shares in several U.S. Crypto companies, and through a large investment in the Grayscale Bitcoin Trust, Ark's ARKW fund has also gained good exposure to BTC.
Ark's most significant holdings in the Crypto industry include investments in Jack Dorsey's Block Inc and the Crypto exchange Coinbase, where it is the fourth-largest shareholder.
Earlier this month, news of the SEC suing Coinbase impacted the exchange's stock price. As Coinbase's stock plummeted by as much as 21% in one day, Ark Invest seized the opportunity to buy 419,324 shares of the company.
The exchange's stock price rebounded after hitting a low of $50.02 on June 6.
On Friday, the stock closed at $61.47, achieving significant growth over the past ten days.
In addition to buying Coinbase shares at a low price, Ark Invest's ETF also purchased over 1 million shares of Robinhood this week, valued at $15.39 million.
Given the simultaneous sale of Tesla shares, this move indicates that the company has a more bullish sentiment towards fintech investments compared to the broader tech sector.
Like Coinbase, the SEC's enforcement actions also affected Robinhood's stock price, but its market performance is not closely related to the overall Crypto market.
On Thursday, Robinhood announced it would acquire the credit card platform X1 to expand beyond its core business, a $95 million deal that will enable Robinhood to offer credit to its customers.
